On Wednesday, March 12, 1947, President Harry S. Truman delivered an address to a joint session of Congress, responding to a burgeoning crisis in Europe. Greece was on the brink of economic ruin, and Great Britain, which had been safeguarding the nation against Soviet encroachment, could no longer offer support. After six arduous years of conflict, Britain was financially depleted.
Around 1 p.m. that spring day in Washington, Truman commenced his speech by positing that the world’s peoples were now confronted with two distinct ways of life. One was founded on the collective will of the majority, characterized by its free institutions, representative governance, open elections, guarantees of individual liberties, freedom of expression and faith, and liberation from political oppression.
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A second way of life, conversely, was predicated on the will of a minority forcibly imposed upon the majority. This approach depended on intimidation and subjugation, a controlled media landscape, and the suppression of personal freedoms. Invariably, he noted, this was not a choice freely made. “I believe it must be the policy of the United States,” he declared to Congress, “to support free peoples who are resisting attempted subjugation by armed minorities or by outside pressures. I believe that we must assist free peoples to work out their own destinies their own way. I believe that our help should be primarily through economic and financial aid which is essential to economic stability and orderly political processes.”
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Truman was now proposing that the United States should provide financial assistance to Greece instead of Great Britain. In many respects, it was rather unexpected that Truman would suggest this course of action. After all, what was Greece to the majority of Americans? Why should an individual in Arkansas be concerned about distant populations about whom they knew so little?
That spring, the US was flourishing; it was the most affluent nation globally. The labor disputes that had disrupted the country the previous summer had long since concluded. Production was escalating, not diminishing; incomes were on the rise. Unemployment had reached an unprecedented low. Stores were abundantly stocked with a remarkable variety of contemporary conveniences. Furthermore, more young men were pursuing higher education due to the generous provisions of the GI Bill.
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Americans were experiencing upward mobility. Truman acknowledged that financially supporting Greece represented a significant commitment and a pivotal direction for the nation. “I would not recommend it,” he continued, “except that the alternative is much more serious. If we falter in our leadership, we may endanger the peace of the world, and we shall surely endanger the welfare of this nation.”
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This was the crux of the issue. Truman recognized that shared prosperity among democratic nations would foster greater political stability, and with that stability, long-term peace was considerably more probable.
It is often said that history repeats itself. While history itself does not repeat, patterns of human conduct do. The world is in constant flux, yet human emotions remain largely consistent throughout time. This implies that valuable insights can be gleaned from a retrospective examination of historical events, particularly from occurrences approximately a century ago that have found echoes in recent times.
At that earlier juncture, there was a devastating conflict, a global pandemic, a financial collapse, trade disputes, and democracy found itself challenged by radical political ideologies.
Although the recent conflicts in Afghanistan and Iraq did not result in the same magnitude of loss of life, they proved to be economically ruinous. Nor was the 2008 financial crisis as catastrophic as the Wall Street Crash of 1929, though this was largely attributable to the prescient measures implemented by President Franklin D. Roosevelt in the subsequent years.
The origins of the United States’ remarkable global ascendancy as a proponent of progressive democracy truly commenced with this farsighted reconstruction effort led by Truman’s presidential predecessor, Franklin D. Roosevelt.
American affluence and overconfident lending directly precipitated the calamitous Crash in October 1929, during which an astounding $810 billion vanished in a mere five days – an truly immense sum for that era. The repercussions worldwide, especially in nations that were still recovering from the economic devastation of the First World War, were exacerbated by the American decision to enact the Smoot-Hawley Tariff Act in May 1930.
This was a profoundly regrettable decision by Congress and President Herbert Hoover, which worsened an already difficult situation in America but proved utterly disastrous for Europe, particularly for Weimar Germany, which had been experiencing a significant recovery as a democratic, manufacturing, and export-reliant nation prior to the crash. The Tariff Act directly led to the failure of national banks in Vienna and Berlin, subsequently paving the way for Hitler and the Nazis. Six years later, the world was once again engulfed in war.
Fortunately, the United States did not follow the path of Nazi Germany or other former democracies. Roosevelt managed to stabilize the economic situation through investments in public works initiatives and by gradually instituting a series of safeguards to prevent a recurrence of the Wall Street Crash.
Roosevelt adhered to the principles advocated by the British economist John Maynard Keynes, whose counter-cyclical economic theories advocated for reduced government expenditure during periods of prosperity and increased spending during times of hardship to stimulate both confidence and economic expansion. Both Roosevelt and Keynes grasped a fundamental truth: that in democratic societies, economic turmoil leads to political fragmentation.
When economic and political instability converge, nations draw closer to the brink of war. The inverse is also true: economic stability fosters political stability and, consequently, peace. Populist politics might appeal to a weary populace disillusioned with financial difficulties, but it rarely improves the circumstances of those voters and invariably diminishes their security.
Roosevelt never lost sight of this principle, and in July 1944, at the height of the war, the US spearheaded a remarkable economic summit in Bretton Woods, New Hampshire. At this conference, 730 delegates from 44 different nations agreed to the establishment of the World Bank and the International Monetary Fund (IMF), along with a new gold standard pegged to the US dollar.
The objective was to prevent any recurrence of economic shocks like the Wall Street Crash. To date, these measures have proven remarkably effective. Britain received assistance from the IMF in 1976, for instance, and it also helped mitigate the impact of the 2008 financial crisis.
Roosevelt also presided over the transformation of the US from a minor military power into the “arsenal of democracy,” and by 1945, it possessed the world’s most formidable military force.
In this process, America also emerged as the world’s most prosperous nation, a status it still asserts today despite the current administration’s efforts to undermine this global leadership role. The lesson here is evident. Increased defense expenditure can achieve a dual objective: stimulate economic growth and ensure national security.
Roosevelt passed away at the age of 63 on April 12, 1945, which led to Truman, a humble domestic politician from the Midwest, unexpectedly assuming the mantle of leadership for the free world. However, he rose to the occasion admirably, so much so that he secured reelection in 1948.
Prior to that, however, he successfully advocated for congressional approval of his truly groundbreaking initiatives. This brings us back to his address to Congress on March 12, 1947, for which he received a standing ovation. The aid package for Greece and Turkey was overwhelmingly endorsed. It marked a pivotal moment and became known as the Truman Doctrine.
From this initiative, however, the Marshall Plan emerged, named after General George C. Marshall, who had previously held the highest military rank in the US armed forces during the war and, by 1947, was a highly respected and largely apolitical Secretary of State.
The Marshall Plan comprised a series of substantial aid programs extended not only to Greece and Turkey but also to former adversaries: Germany, Italy, and Japan, among others, as they undertook reconstruction efforts amidst the devastation and turmoil of the Second World War.
This was the first instance in history where the victors provided financial support to the vanquished.
When the Marshall Plan was announced in the summer of 1947, Truman was questioned about why it wasn’t named in his honor. “I’m not doing this for credit,” he responded. “I’m doing it because it’s the right thing to do.”
The present-day US president could draw valuable lessons from this modest and truly principled individual.
Eighty years later, the positive outcomes of this extraordinary governmental decision by the United States are still being realized, because make no mistake, this vision for enduring peace was, at the time, truly revolutionary and unprecedented. It was also a decision that ushered the West into a new era of escalating prosperity, improved living standards, and stability – a condition that is today taken entirely for granted.
However, as the Second World War recedes into the past, so too does our collective recollection of what it was like to endure a global conflict: the hardships, the suffering, the destruction, the tragic loss of life, and the displacement of millions. The sheer cruelty.
The post-war peace and the associated freedoms were cherished and highly valued. Today, a sense of complacency has diminished the West’s appreciation for the fundamental precariousness of democracy – and of peace. It is taken for granted rather than being valued for the hard-won sacrifices made to secure it 80 years ago.
- The Visionaries: The Making of the Post WWII Order in the West, by James Holland (Bantam, £20) is published on May 7
